Consumer Confidence Moves with the Market

Chart of the Week for August 3-9, 2001

The Consumer Confidence Survey is a monthly measure of the public’s confidence in the health of the U.S. economy. Because it measures the mood of consumers towards buying, it can help predict future buying trends. As a result, manufacturers, retailers, banks, the Federal Reserve, and United States government agencies rely on the Survey for forecasting. With rising jobless claims and moderating stock prices, the index has fallen considerably in the past twelve months.

The value of the index is in comparing changes over time rather than looking at an isolated month. However, when the Consumer Confidence Index exceeds 100, this typically signifies an optimistic outlook on the economy.

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